NextEnergy Capital has confimed the first close of its fifth investment vehicle NextPower V ESG (NPV ESG), a fund targeting capital commitments of $1.5 billion-$2 billion for investments in solar PV and energy storage infrastructure assets located in OECD [Organisation for Economic Co-operation and Development] countries.
First close commitments to NPV ESG amounted to $480 million, comprising $330 million in direct commitments and $150 million in co-investment allocations.
Investors in NPV ESG include KLP, a German occupational pension fund, and a large Nordic pension fund. NPV ESG expects add additional investors in its second close later this year, with several investors currently active in due diligence, a statement said.
NPV ESG will target mid double-digit returns and its projects will be backed by â€œlong-term stable cash flows, backed by robust, credit-worthy PPAs leveraging the teamâ€™s OECD-based PPA expertise, as well as regulated revenues,â€ the statement added.
The fundâ€™s primary geographic targets include Europe, North America, and Chile, where NextEnergy Capital currently manages an extensive solar PV infrastructure asset portfolio. NEC has identified a pipeline of investment opportunities for NPV ESG spanning over 14GW in these regions.
NPV ESG is classified as an Article 9 Fund under the EU SFDR, and at its investment ceiling is forecast to produce enough clean energy to power the equivalent of up to 750,000 households per year and avoid an estimated fossil fuel consumption of up to 150 million m3 of natural gas per year.
Michael Bonte-Friedheim, CEO and founding partner of NextEnergy Group, said: â€œNPV ESGâ€™s first close represents an important milestone as the fund secures strong investor support from the get-go. Utility-scale solar represents a very large investment opportunity set globally, with total spending in 2023 forecast to reach $382 billion, and we aim to continue our leadership role in the sector.â€
Shane Swords, NextEnergy capital managing director and head of investor relations, said: â€œThe NextEnergy Capital platform continues to experience positive momentum with this strong close. I am always elated by the support of existing investors that stick with us from strategy to strategy and new investors that join us. I think that with our exemplary track record, length of experience in solar and the solar opportunity set out there, this fund creates a fantastic opportunity for investors looking for strong and stable renewable energy returns.â€